Fmr. Congressional Medicare Advisors Endorse Effort to More Accurately Align Physician Work With Pay

Seven former chairs and vice chairs who served on the Medicare Payment Advisory Commission (MedPAC), an influential agency that advises Congress and the Centers for Medicare and Medicaid Services (CMS) on Medicare policy have come together to endorse the Trump administration’s plan to “modernize” how the federal health insurance program sets payment rates for physician services. Their years serving on MedPAC cover the period (2006-2025) during which MedPAC has issued recommendations to Congress on this topic.

The endorsement letter to CMS Administrator Dr. Mehmet Oz notes their longstanding concerns about the “shortcomings in the process used to refine and update the Medicare physician fee schedule.”

The letter states: “We also agree that new [bill] coding, including adoption of prospective, bundled payments for primary care services, has the potential of enhancing the value of care provided under the fee schedule.”

Paul B. Ginsburg, Ph.D., who served as MedPAC Vice Chair from 2019-2022, says, “The degree to which relative payments for different physician services are in line with the resources involved in providing them has worsened over time as many procedures have experienced decreases in the time, work and practice expenses while the productivity of most visits has not changed. Relying less on surveys of clinicians who perform the procedures and more on objective data has the potential to increase both the efficiency and fairness of Medicare physician payment.”

The endorsers write that “MedPAC leaders rarely, if ever, have come together to submit a common comment letter on a proposed Medicare rule. However, we consider [this moment] to be of sufficient importance that we do so now to provide support.”

A complete copy of the letter, with signatories, appears below.

Dear Dr. Oz:

All of us are former Chairs or Vice Chairs of the Medicare Payment Advisory Commission (MedPAC), who served during the 2006-2025 period, when MedPAC, in many of its reports to Congress, discussed shortcomings in the process used to refine and update the Medicare physician fee schedule. Former MedPAC leaders rarely, if ever, have come together to submit a common comment letter on a proposed Medicare rule. However, we consider the “efficiency adjustment” approach CMS adopted in the proposed Physician Fee Schedule rule to be of sufficient importance that we do so now to provide support.

We have all experienced exasperation that MedPAC’s consistent calls for greater use of objective empirical data have long been ignored by CMS—but now have been endorsed. In the proposed rule for the 2026 fee schedule, CMS concurs with our observations, stating that many procedural codes reviewed by the RUC appear to be inconsistent with assumptions regarding resource costs based on time spent by clinicians, and not regularly updated for time-saving changes in medical technology. In the NPRM, CMS endorses the findings of the 2015 GAO report finding that the specialty survey results raise concerns because of low response rates, low total number of responses, and a wide range in responses, all of which may undermine the accuracy of RUC recommendations on clinician work. In the NPRM, CMS also agrees with GAO’s and MedPAC’s concern about possible biases in the survey process, given that the respondents of the surveys directly benefit from longer time and more complex work components of RVU calculations.

Given these flaws in prior estimates of work that have been applied to over 9,000 fee schedule codes, CMS proposes adopting an “efficiency adjustment” to apply to non-time-based codes to begin the process of reevaluating the work relying much more on empirical data. We endorse CMS’s view that applying the efficiency adjustment to non-time-based services broadly, rather than targeted only to demonstrably overvalued work estimates, “may help to improve the overall accuracy of our valuation of these services under the PFS.”

Even more important, the Fact Sheet from CMS goes on to state, “We are also proposing that, going forward, CMS may give preference to empiric studies of time to incorporate into service valuation, compared to low-response rate survey data, and solicit comment on the types of empiric data that CMS should consider. CMS expects that moving away from survey data would lead to more accurate valuation of services over time and help address some of the distortions that have occurred in the PFS historically.” Many researchers and policy analysts not affiliated with any stakeholders, including some of us, as well as MedPAC as a whole, have been advocating this approach for some time and have explored ways to bring objective data into this process of revising the relative value scale.

We also agree that new coding, including adoption of prospective, bundled payments for primary care services, has the potential of enhancing the value of care provided under the fee schedule. As CMS emphasized in last year's physician fee schedule rule, experience gained from CMMI-sponsored demonstrations can be channeled into improvements in both coding and payment within the fee schedule.

Robert A. Berenson, M.D.

Vice Chair, 2011-2012

Francis J. Crosson, M.D.

Chair, 2016-2020

Jon Christianson, Ph.D.

Vice Chair 2014-2019

Paul B. Ginsburg, Ph.D.

Vice Chair, 2019-2022

Glenn Hackbarth, J.D., MPP

Chair, 2001-2015

Amol S. Navathe, M.D., Ph.D.

Vice Chair, 2022-2025

Robert D. Reischauer, Ph.D.

Vice Chair, 2002-2008